Josh Klein explains why reputation systems like Klout will never work in Can Reputation Come Down to a Number?:

There’s a more nuanced problem interwoven into the problem of arriving at a unified reputation system. The people who are attempting it, such as Klout and Kred, might hope to measure reputation but their algorithms, at best, track influence. The two are not equal. Influence is the ability to get others to take action, such as donating funds. But how that influence can be wielded is critical; Obama had great luck in soliciting donations using his influence, but so did Butch Cassidy. Influence is different in different contexts, and measuring only “influence” means you are judging someone’s capabilities without any of the necessary context.

Personally, I think the only online reputation system that does work is Klouchebag.